PMB Rentals, LLC v. Schultz, James
Case Background
On July 11, 2022, PMB Rentals, LLC filed a breach of contract lawsuit against Dimitrios Elias Psaras and his attorney, James J. Schultz. The complaint included claims of statutory theft, fraudulent misrepresentation, breach of contract, and covenant of good faith and dealing.
The case was filed in the Connecticut State, Superior Court, New Britain Judicial Division. Judges Eric Smith, Joseph Shortall, Kimberly Knox, and Lisa Morgan presided over this case.[Case number: HHB-CV22-5031853-S]
Cause
PMB Rentals, LLC (“PMB”) was an active Tennessee Limited Liability Company with its corporate address at 1075 Mineral Wells Ave, Paris, Tennessee. It was legally registered to do business in Connecticut and specialized in renting-to-own portable sheds. PMB operates in multiple states, including Tennessee, Kentucky, Ohio, and others. The company partnered with shed manufacturers and sales lots to offer rent-to-own options for customers, allowing them to pay a reduced first month’s rent and enter into an agreement to receive a shed. PMB then paid the shed manufacturer the full purchase price, thereby acquiring ownership of the shed.
In April 2021, Tim Boyd, the owner and president of PMB, was contacted by Dimitrios Elias Psaras (also known as “Jim Psaras”), a Connecticut resident. Psaras proposed a business relationship, claiming he had acquired 17 sheds and two hauling trailers from a retiring couple and was starting a business called Quality Shed Rentals in Connecticut and Massachusetts. He sought PMB’s rent-to-own services for his customers. Between April and September 2021, Psaras and Boyd communicated to establish the relationship.
On September 13, 2021, Boyd and his team had a call with Psaras and his attorney, James J. Schultz, to discuss the rent-to-own proposal. Schultz, a Connecticut attorney with a long-standing relationship with Psaras, assured PMB that funds would be handled through his account. Defendant Schultz had previously represented Psaras in various legal matters, including criminal cases.
However, PMB later discovered that Psaras and Schultz had engaged in fraudulent transactions. They fabricated the rent-to-own deals, using sheds that had been previously sold to other customers.
Schultz had used his attorney-client funds account to process payments for these fake transactions. PMB paid over $116,000 for these bogus deals, and investigators found that Psaras and Schultz had been accepting funds from other customers as well.
Damages
As a result of the actions and omissions of Psaras and Schultz, both individually and jointly, the Plaintiff has suffered significant harm and seeks a range of legal and equitable remedies. The Plaintiff demands monetary damages, along with punitive and treble damages, as outlined in Counts One, Two, Six, and Fifteen. Additionally, the Plaintiff seeks attorney’s fees, interest, and specific performance, as detailed in Count Sixteen. Plaintiff also requests allowable costs and any other relief available under law and equity to fully address the harm caused by the defendants’ misconduct.
Key Arguments and Proceedings
Legal Representation
- Plaintiff(s): PMB Rentals, LLC
- Counsel for Plaintiff(s): Paul Stewart Levin
- Defendant(s): Dimitrios Elias Psaras | James J. Schultz
- Counsel for Defendant(s): James J. Schultz (pro se) | Dimitrios Elias Psaras (non-appearing)
Claims
1. Statutory Theft
The Plaintiff filed a claim of statutory theft under Connecticut General Statutes § 52-564 against James J. Schultz and Dimitrios Elias Psaras. Both defendants were accused of knowingly accepting Plaintiff’s funds while recklessly disregarding the falsity of the underlying transactions. This wrongful conduct entitles the Plaintiff to treble damages.
2. Fraudulent Misrepresentation
Plaintiff also brought claims of fraudulent misrepresentation against Schultz and Psaras. The defendants allegedly made false representations and concealed material facts during their dealings with Plaintiff. These misrepresentations induced Plaintiff to enter into contracts, causing significant financial harm. The fraudulent statements were material to the Plaintiff’s decision to proceed with the transactions.
3. Breach of the Covenant of Good Faith and Fair Dealing
Plaintiff asserted that both Defendants breached the covenant of good faith and fair dealing. By entering into contracts with Plaintiff, Schultz, and Psaras had an implied obligation to act in good faith. However, their false statements and concealment of key facts violated this duty.
Consequently, Defendants deprived Plaintiff of the expected benefits of the agreements, resulting in financial loss and reputational damage.
4. Breach of Contract
Lastly, the Plaintiff accused Schultz of breaching the contract by failing to deliver the promised rent-to-own customers in exchange for payments. This failure to perform contractual obligations led to monetary losses for the Plaintiff, which also required the Plaintiff to invest time and resources in seeking legal recourse.
Defense
Defendant James Schultz (Schultz) and Dimitrios Elias Psaras (Psaras) asserted that Plaintiff’s breach of contract allegations are baseless and involve intentional misconduct, negligence, and defamation. They filed a counter-complaint in response which stated the following:
Schultz, a Connecticut attorney since 1988, was asked by Psaras in March 2021 to process payments for sheds. Schultz agreed, charging a 3% fee for forwarding payments to Psaras in Greece. He asserted that his role was limited to receiving and forwarding payments; he did not negotiate sales or deliveries and had no contractual relationship with PMB Rentals, LLC (PMB).
Plaintiff, however, engaged in harmful tactics, sending investigators to falsely accuse Schultz of fraud, resulting in his wrongful arrest. Schultz further claims that PMB misrepresented Psaras’ criminal background, which was non-existent, and defamed him through defamatory statements. Plaintiff’s false claims that Psaras had a criminal record for fraud were spread to consumers and law enforcement, leading to a prolonged legal battle and severe personal consequences for Schultz. Despite knowing the truth, PMB continued to spread misinformation, damaging Schultz’s reputation.
Schultz also alleged that PMB, through investigators, deliberately misled consumers into filing false complaints, which ultimately led to lawsuits that the court dismissed in his favor. These actions caused significant financial and emotional harm to Schultz, including loss of savings, forced living conditions, and health deterioration.
Moreover, Schultz argues that PMB’s actions violated Connecticut’s Unfair Trade Practices Act (CUTPA), engaging in deceptive and harmful business practices. Plaintiff’s misconduct disrupted Schultz’s ability to defend the current suit and practice law, aiming to cause long-term damage to his professional and personal life.
In addition, Schultz contends that PMB failed to implement basic loss prevention measures, despite having the resources to do so, which could have mitigated the damages.
Jury Verdict
On November 8, 2024, the Connecticut jury found in favor of Plaintiff PMB Rentals, LLC and awarded $116,832.75 in economic damages.
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